December 24, 2012 – Hospitals and health systems nationwide expect their capital expenditure budgets to drop below 2010 levels as they anticipate patient admission reductions, according to the Premier health care alliance’s fall 2012 Economic Outlook.

Just 41 percent of 617 survey respondents – primarily hospital C-suite, and materials and practice area managers – are projecting their capital spending to increase compared to last year. This is down from 42 percent in fall 2010 and a two-year high of 46 percent in spring 2011.

When asked about the area in which they expect to make the largest capital investment over the next year, the hospitals surveyed noted IT as a top priority. Some 43 percent cited healthcare information technology (HIT) and telecommunications as the area of largest spend, up from 34 percent in spring 2011. After that, 34 percent cited capital investments in infrastructure and construction as their biggest area of outlay, up from 28 percent in fall 2011.

Investments in imaging, lab, and surgical and clinical equipment are forecasted to drop by more than 23 percent compared to just six months ago, according to survey results. The dip in capital spending is driven by reimbursement cuts, cited by 74 percent of respondents as the number one trend impacting their hospital. Another factor could be an anticipated reduction in patient admissions. Twenty-four percent of respondents believe their patient admissions will decrease, more than double what was projected in fall 2011.

According to Premier President of Supply Chain Services Durral Gilbert: “Whether due to lower reimbursement or fewer patients, health systems are making tough choices on how to most effectively and efficiently provide care. It is clear they consider the value-analysis process of using integrated data to improve outcomes and reduce costs paramount in the current health care environment.”

Reducing waste is a top priority. When asked what they consider to be the two biggest drivers of health care costs, one-third of respondents cited overutilization of products and services.

Premier spans 2,700 member hospitals. The alliance offers data and purchasing services.

This story originally appeared at Health Data Management.

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